EUR/USD plunges — Will sellers keep the pressure on?
The EUR/USD has taken a significant hit recently as it traded below crucial support levels, raising questions about the extent of pressure from sellers. This move aligns with our bearish sentiment on the euro against a broadly strong dollar driven by robust U.S. economic indicators. Traders are closely monitoring technical signals for signs of further downside, especially as spot prices hover around 1.1446. A sustained break below these support levels could trigger deeper capital outflows from the eurozone.
Where it sits in our coverage
Our consensus EUR/USD target stands at 1.1634 (median across 11 firms), with Nomura and SocGen at the upper bound (1.1800) and Lloyds at the lower bound (1.1200). The bearish shift in sentiment seems to align with a downward trajectory reflected by the recent declines, indicating that many firms expect the euro to remain under pressure.
How firms align
Recent positions from firms like RBC, which also foresees a target of 1.1700 for March 2026, diverge from the current market reality of 1.1446. Meanwhile, Citi takes a notably more pessimistic stance, forecasting 1.1300 for March 2026, suggesting significant divergence in outlooks post-recent market moves. You can find detailed insights into these variations in our /reports/rbc and /reports/citi.
What the data shows
Recent forecast adjustments from UOB and ING indicate a more cautious approach, with UOB now pegging its March target at 1.1536. This shift reinforces the idea that sentiment is gradually shifting towards a bearish outlook. Refer to our related Insight: /research/eurusd-ecb-rate-path-2026-10-03 for further analysis on these trends.
Key takeaways
- 01EUR/USD at 1.1446 indicates significant bearish sentiment.
- 02Watch for technical levels around 1.1450 for potential downside risks.
- 03Markets may react to upcoming U.S. economic data releases as catalysts for further movement.
- 04Lloyds' target of 1.1200 highlights further bearish expectations from some firms.
Market implications
Traders should watch for critical support indicators around 1.1400, as sustaining below this level could lead to an acceleration in downward momentum. The upcoming U.S. economic data releases, particularly job numbers and inflation metrics, will be pivotal in shaping future direction against our consensus target of 1.1634.
Risks to this view
Any unexpected hawkish signals from the European Central Bank or substantial improvement in eurozone economic data could invalidate the bearish outlook. Additionally, if the ECB's forthcoming communications hint at a tighter monetary policy sooner than anticipated, this could reverse the prevailing sentiment against the euro.
Sentiment by currency
USD+EUR JPY~GBP~Composite USD score: +0.60
Sources & References
How we cover this story
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